The Short End of the Long Tail

In the small but bustling business of Video-On-Demand a day will not go by without someone referring to “The Long Tail”. The type who will mention it is likely to be a consultant – or at least to look like one. He will wear a tie and look very B.C.B.G. and, unless you represent a major US film studio, he will make you feel rather insignificant before saying, nonchalantly, something like: “ Well, I suppose your programs are of the long tail variety”, or “ Well, then we are really just talking about the long tail”. As he pronounces this verdict you will no longer seem insignificant in his eyes – you will begin to disappear. Pleased at catching you unawares with his brilliance – and half suspecting you don’t even know what the long tail is – he will turn his thoughts to the next meeting, looking forward to another opportunity to use the phrase.

For mathematicians the Long Tail has been around for quite some time. It refers to a certain aspect of a statistical distribution, showcased in the figure below. In layman’s terms, while the amplitude of the red part of the graph is significantly higher, the yellow part of the picture represents cumulatively a larger surface.

For most new media types “The Long Tail” was born when they read an article under this title in the Wired magazine. Looking at the economics of Amazon.com or Netflix, the article’s author, Chris Anderson, noted that the most important revenues of these virtual stores were not derived from traditional bestsellers and blockbusters, but from the aggregated sales of “niche” books or movies. “Forget squeezing millions from a few megahits at the top of the charts,” concluded Anderson. “The future of entertainment is in the millions of niche markets at the shallow end of the bit stream”.

This fact came as a shock to media executives, used to the never-ending chase for the next box office hit. Since the Wired article was published in 2004, the topic has justifiably grown into a research domain, the scientific aspect of which can be glimpsed from Anderson’s blog. www.thelongtail.com. In parallel, a certain Long Tail dilettantism emerged among the very media execs who at first were shocked by it. Passed on in an industry version of a “broken telephone” the Long Tail has finally arrived to European media consultants, especially those endowed with lucrative contracts to program telecom VOD services. My guess is that most of them catch the Long Tail bug when they go to L.A. to shop for movie rights.

Back from Hollywood – either with empty hands, or with an empty wallet – these VOD consultants are faced with a great dilemma. The Long Tail may be the buzz of the time, but to them it makes no sense. Surely, the only way to get subscribers for a VOD service is to buy football rights and the latest blockbusters.  It is this schizophrenic mindset that brings them to refer to the Long Tail while rejecting anything that looks like it. 

They are right to be wary – for this concept, taken to an extreme, means that in an ideal Video-On-demand world, with all media available to a digital subscriber, Fellini movies and Jazz concerts will be as important as the latest Spielberg flick. It also means that no individual telecom will be able to fully control an on-demand service within its country –to get the full benefits of the Long Tail you have to aggregate “niche” clients across multiple territories. Taking this reasoning even further, this means that just as Amazon is a global virtual store, expressed through its local portals, so is an ideal VOD movie or music service.  Media groups and rights owners are in a better position to create such global VOD platforms of the future, than the telecoms. Which means that the abovementioned consultants will soon be out of the job – getting the short end of the stick, or, in this particular case, of the Long Tail…. But reasoning too much is an academic habit – and the Long Tail, for all we know, might remain a theory, an ironic reminder that readers of “War and Peace” do in the long run outnumber those who read Dan Brown.